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Weekly
Update Bulletin On-Line.........
.. In The News and Readers Write In (with our answers to Questions).......... |
| IN
THE NEWS:
.. Your greatest retirement fear: Can you count on Social Security? October 11, 2002 - By Walter Updegrave, MONEY Magazine - From the on-line story (following link below for full article): . NEW YORK (MONEY Magazine) - If you want to rile Dean Baker, co-director of the Center for Economic and Policy Research, just suggest that the Social Security system is in dire straits. Sitting in one of the center's cluttered fifth-floor offices in the Dupont Circle neighborhood of Washington, D.C., Baker is obviously incensed at the notion. The idea that the system is on some precipice is just not true, he said. . Just a few blocks across town, Michael Tanner, director of the Cato Institute's Project on Social Security Privatization, sees the situation, shall we say, somewhat differently. Taxpayers are putting money into a program that cannot pay the benefits promised to them, he says. That's a problem they're facing now, not just down the road. . http://money.cnn.com/2002/10/10/retirement/social_security_abstract/index.htm . . INVESTMENT UPDATE: . We erroneously reported in the last bulletin that the yield for The Guardian US Dollar Tax-Free Cash Reserves Series was 8.22%. The actual and correct yield as of Oct. 15, 2002 is 9.02%. Also, this yield is believed to remain constant over the next three months, and in addition, increased pressures on the local interest rates in the Dominican Republic could lead to some higher yields as well going forward. To make some comparisons, one of our clients recently obtained a 90-day CD rate from a local bank of 8.5% for a US$100,000 deposit. The benefit then of the fund is that it would be able to take advantage of higher rates for clients (often at the very same banks) in part by grouping deposits into larger jumbo CD's than what clients might be able to take advantage of individually. For more information: . http://www.theguardiangroup.com/ . . READERS WRITE IN: . . On the Subject of the US Federal Reserve mentioned in our last bulletin, this reader writes: . John, . Again a very good news-letter this week. However, your enlightening explanation of currency versus debt stopped a little short. Since Federal Reserve Notes are un-backed fiat currency the government can re-issue them after collecting them. If the FED accepts them back as payment - now that is the question! I've read debt payments must be made 'at par', that is, in gold. In that case is anyone up to figuring out: (US debt) / (All the GOLD on the planet). Now, what should the price of gold REALLY be, to even make that debt payable??? $1000/ounce? Maybe try adding a few zeros to that! So, let us forget the above and *pretend* US currency has some intrinsic value and the debt can actually be paid. The math says: . If the government immediately stops increasing the debt, WHICH IT WON'T, and is able to reclaim 5% of the circulated currency per year in taxation to put towards debt payment, WHICH IS IMPOSSIBLE, it will take only a scant *210* years to pay off the national debt - not including the compounding interest. I'd love to hold the note on that mortgage! . EDITORS REPLY: Thank you for your letter. In addition, I would say that all in all, I would have to agree. Although, some might say that buying gold is the answer, but unfortunately, holding gold does not provide interest. Investing in real estate of course in the least allows for rental income, but that can be another set of headaches also. In short, it can difficult to say what the final answer is, but in the least, I think it worthwhile for investors to understand exactly what is going on and how that may or may not effect them going forward (which might include trying to at least keep pace with the unofficial and real devaluation of the currency and or investing into other currencies). . . On the Topic of Panama, also mentioned in our last bulletin, this reader writes: . I have to agree with the gentleman about Costa Rica. It only took me one trip to cross it off my list. It took me eight trips to Panama, and three to the Dominican Republic to decide on Panama. In the three months I have lived in Panama, I have been stopped many times myself. I have met only one rude officer and that was probably my fault more than his. I argued with him so now I owe a US$35 ticket for passing over a double yellow line, which I did. Beauty is in the eye of the beholder. Yes, most of the "hookers " are Columbian, but so are a lot of the professional nurses and dental assistants, etc. I live in the city $ 450 a month for a rather large two-bedroom apartment. I can walk to 40 or 50 good restaurants and clubs. I walk most places, but you can go most places by cab for one dollar. Love it. . EDITORS REPLY: Thank you for your letter and for adding your comments about living in Panama. . . Also on the topic of Panama, another reader writes: . I feel compelled to comment on the anecdotes of one of you readers, who contributed to the October update - the American "John" who has recently traveled for three weeks through Costa Rica and Panama. It seems clear to me that the writer could easily qualify for what we call in Oz "The Ugly American"(sorry John) who seems to have a sizable chip on his shoulder and would probably be best off remaining in the US. Particularly offensive are his remarks about "ugly people"(in Panama). Irrespective of his aesthetic preferences, if he took the time to really look at the people I am sure even HE could see the "Beauty". I wonder how Panamanians would view him? Interesting to note that the "Lonely Planet Guide" to Panama describes the Panamanian people "so beautiful you could cry" . EDITORS REPLY: No offense taken and I would also have to agree with you as well. Beauty is certainly in the eye of the beholder and thank god - because it means ugly guys like me have a fighting chance. . . Also on the subject of Panama: . . Dear John, . I disagree with your reader that thinks Panama is a bad place to live. I certainly don't think it is a police state. The transito (traffic police) likes to set up roadblocks to check people's driver's license. This is a source of bribe money for them as many people drive without a license and then pay the police $5 whenever they are stopped. I have never had any trouble opening a bank account in Panama and they seem happy enough to take your money. It is a bad idea to accept no in Panama. Persistence almost always pays off. A Panamanian Cedula also helps. I had a terrible time getting FENOSA to run power lines to my Finca (it was much harder than opening a bank account as it involved putting in 17 poles), but persistence did pay off and I now have electricity. I am still fighting with Cable and Wireless to put in a phone but I expect to get it in the end. The teak farm business for residency is a rip-off. As you say it is best to look for land at a favorable price - as the economy is very bad in Panama at the moment. It takes a lot of patience to buy land in Panama. It is best to rent first and take your time looking for land. Also it is best to avoid your fellow Americans as much as possible in the beginning and work at the language as hard as you can. Go all the places that are popular with the Panamanians and talk to them as much as possible. Just like the folks in rural Tennessee where I come from, they love to gossip. It is absolutely their favorite past-time. Gradually you learn about all your neighbors (who to trust and who not to trust). Also you become accepted as a member of the community. Anyhow, I been in Panama for over three years now and like it a lot. The best province is Chiriqui, next to the border with Costa Rica. It has several towns with a comfortable climate above 1000 meters in elevation. Panama is being overrun with Chinese. They own a big percentage of the food stores in Panama. They mostly bribe their way in (in other words they pay for a cedula). I wouldn't feel comfortable with this method myself but it certainly seems to work for the Chinese as they own their businesses and raise their families in Panama (and have bank accounts). Of course Panama is Third-Worldish, but after a while you come to accept it as normal. In fact so much so with me that I am shocked whenever I go back to the states. Just thought I'd add my two cents. . EDITORS REPLY: As always, I do very much appreciate the perspectives and viewpoints of others, and am glad you decided to write in. On the subject of banking, I would say that things have certainly changed within the last three years and having residency in Panama certainly helps when it comes to banking. So, I cannot say if you would find it so easy today (walking in as a foreigner and not a resident) to open an account at the moment. However, all in all, I would agree with most of your comments. Panama can certainly be an enjoyable place to consider for retirement or relocation. But just like anywhere else, it has its positives and negatives to consider as well. . . Also, on the subject of Banking in Panama: . John . You said - getting a bank account open in Panama is like getting dental work done without anesthesia. I had my local bank (worldwide) in Canada contact their branch bank in Panama with the plan to transfer funds for say to buy some real estate. The representative in Panama was in contact with my Branch manager and all I had to do was complete the supplied forms. There was never a hint of not opening an account for me. Of course I am treated as a "substantial" customer and my manager indicated that this would be of no small matter to ignore. (They know their customer). A plan was to open up an account in both DR and Panama using corresponding banks if possible. Your comment put some water on my not very strong desire to follow Roger Gallo. The point being I do not need new and higher hurdles to jump with fewer places to escape to. . EDITORS REPLY: Well, I honestly do not know what Roger Gallo has to do with anything, but I will say that your experience seems to be unique all things considered at the present moment. I know from my own experience in the past, that it was almost impossible to open a bank account in Panama by mail (unless of course the nominee directors on a company or foundation were the authorized signers, which is not an attractive option for most people). Very recently, it would seem that even physically visiting Panama with a whole stack of bank references and related documents will not guarantee any success either, which is what I was reporting on. Also, a very important point YOU mentioned was that you were sending funds to the VERY SAME bank you currently do business with in Canada (the Panama Branch of YOUR Canadian Bank), which makes a difference as well with respect to smoothing the way. I do not control what the banks do or do not do. I wish I could. All I can do is report on the current situation and hopefully offer some advice, insight and a possible solution for our clients. However, the fact remains, it is much more difficult for a foreigner to open a bank account in Panama than was the case in the past. And considering that the Panamanian Banks are flush with cash, they really do not care to bend over backwards for new customers at the moment. . . Another Reader Writes: . I honestly love all your information. I have visited the majority of the countries listed by your service. I will like to inform you that the actual spelling is Colombian and not Columbian. . EDITORS REPLY: Thank you for your positive comments, and you are of course correct. Sorry for the spelling error. . . Another Reader Writes: . Hello John, . Thank you very much for all the updates that you forward me. I for one am very thankful that there is someone like yourself out there telling the truth about this doomed system that we live in. Both my brother and I need no more convincing about this corrupt system, we had always known it, but all of your reports really convinced us to make future necessary plans to avoid living under a controlled system. In my opinion all of our so-called elected officials main objective is to sit around and think of new ways to tax the American people. Quite frankly most Americans are gullible and clueless as to what really goes on. You are a true patriot John and keep the info coming. . I have seen the benefits of the banking system in the D.R. not to mention owning some very nice real estate for next to nothing. I wanted to be a little closer to the U.S. because I still have part of my immediate family here. I was thinking of buying a condo or a small house in Mexico to travel back and forth living in both places. But some of these places for sale have U.S. presence and offer U.S. Title and Insurance. Of course, I do not want to any U.S. entity to be involved in my personal affairs due to it may be reported to the U.S. government. How can I go about doing this without my friends at the IRS finding out? Do you have any information you can share on Mexico? Thank you and I look forward to hearing from you. . EDITORS REPLY: Well, the truth is that we do have some American clients living in Mexico, that do some of their banking in the Dominican Republic, but apart from that, I honestly do not have any concrete or in depth information on Mexico to offer. With regards to investments of any kind and related privacy issues, I can suggest the idea of either a locally incorporated company (to be used as a sort of holding company) and or a Panama Foundation. This strategy has worked out well for most of our clients living and investing abroad (including real estate ownership). . . Another Reader Writes: . John, . I like your libertarian commentary. I have one question that I suppose you have answered a dozen times. I live and work in a foreign country (not USA or Canada) but trade actively on-line (Internet) with an American discount broker. What on-line brokers do you recommend? Do you recommend American on-line brokers with offices in foreign countries? The reason I ask is that I don't particularly like to deal with a broker in the USA itself. Am I paranoid? . EDITORS REPLY: The truth of the matter is that the US Treasury Department has recently come down hard on US brokers in regards to accounts owned by non-US (offshore) entities. This of course has been a reaction to the fact that ever since the regulations were amended to allow stock brokerage capital gains to be tax-free for foreigners (to encourage foreign investment into the US stock markets), Americans quickly figured out they could take this benefit by simply making themselves a foreigner (on paper via an offshore company, etc.). So, this really is the issue. Is it better to have your accounts domiciled outside of the US for asset protection purposes? The answer is YES, but of course brokers outside of the US will not be as cheap as the US discount brokers and there may not be the type of on-line trading access as well. At the moment, one might say it is a trade off, although I do think that discount brokerage will eventually come on a large scale to the offshore brokerage industry. However, it will take some time to reach the depth and level at which it exists currently in the US. . . Another Reader Writes: . John, . You know what kills me? - And I was now thinking about this recently, is the fact that a person works hard for many years saving to buy a $200,000 house, but can't afford the yearly $6,000 property taxes, which keep getting higher. Yes, in Texas, property taxes are that high. No state income tax you say? You give the government state income tax and property tax, and both will rise. Also, children who inherit a $200,000 house, but who can't afford the property tax, they have to sell their parents' house or the government seizes it. American dream? An illusion. Freedom? An illusion. . EDITORS REPLY: I think this is a very common sentiment among many middle class Americans, so you are not alone (which is why so many are expatriating and also are interested in buying small farms in a peaceful and low tax country - at least this is one of the trends I am seeing and to me it makes sense). . Another Reader Writes: . . Enjoy your weekly e-mail reports and letters. Question re banking in DR: Supposing a bank account in DR, capital invested in guaranteed certificates, in pesos rather than $ - have you heard of any problems associated with getting interest, or capital, transferred to Canada. . Another Reader asks the following related question (so I am combining the two in order to answer both at the same time): . IS THERE FEDERAL DEPOSIT INSURANCE ON BANK DEPOSITS IN THE DOMINICAN REPUBLIC, AND IF SO, FOR HOW MUCH? . . EDITORS REPLY: On the first part, there are NO currency exchange controls in the Dominican Republic. Also, one client telephoned us after being told by another offshore incorporation services firm that residents and or citizens were required to convert ALL of their funds into Dominican Pesos, which is NOT TRUE. Both foreigners and local residents (and citizens) alike may have only a US Dollar account (if they wish), only a Peso Account (if they wish) or maintain both US Dollar accounts and Peso accounts as well. There is NO requirement that ANY owner of a bank account maintain accounts in any one currency specifically, or convert any amount of their funds into Pesos, and there are no problems sending funds abroad either (or receiving funds as well). However, the vast majority of the local banks in the Dominican Republic will offer primarily US Dollar Accounts, Dominican Peso Accounts, and now very recently, accounts denominated in the new Euro currency. This being the case, it stands to reason that it would be easier or more common for a Dominican Bank to offer either a bank wire transfer (or US Dollar bank check) denominated in US Dollars or Euros only. Therefore, when sending a wire transfer to Canada (for final deposit to a Canadian bank account denominated in Canadian Dollars) it is the case that US Dollars would be wired and then converted into Canadian Dollars by your bank. The Dominicans have nothing against the Canadians, but when it comes to banking, the mindset is most geared towards US Dollars as the main foreign currency. Although ironically enough, based upon some of the statistics I have seen, there probably is an equal (if not greater) amount of commerce with Europe than with the US. So, it is quite possible that the Euro might overtake the US Dollar as the principal foreign currency in time (but this does not mean that banks will stop offering US Dollar accounts). . On the topic of safety and insurance, the very interesting stereotype that still exists among Americans especially is that banking outside of the US is wild and wooly. In fact, the very opposite is true (although places like Macedonia I would not touch with a twenty foot pole). Many countries, like the Dominican Republic, have a very strict government owned Central Bank (as opposed to the US Federal Reserve Corporation, which is a private institution), which monitors and regulates the banking industry. In addition, there is also a system of reserve deposits (insurance deposits), which can go up to 20% depending upon the type of asset or liability the bank has. Meaning, the Central Bank of the Dominican Republic conducts a quarterly audit of ALL the local banks. Local banks in the country are required to post a security reserve depending upon changes in their capital and depending upon the types of accounts and liabilities (checking accounts, savings accounts, certificates of deposits, amount of loans, etc.). The average reserve is about 5 to 6%, but can go much higher for things like unsecured loans (outstanding credit card balances and personal loans) or non-performing loans. The logic behind this is, not only should there be a reserve for savings accounts, but an even higher reserve posted for loans (because in effect, this is depositors money being loaned out and possibly put at risk, so to me it does make sense to require an insurance reserve for both deposits and loans). . In comparison to the FDIC insurance program, the US FDIC currently has LESS than 1.5% in reserve for ALL the banking deposits in the United States at the moment. And we are not even discussing the idea of a forced reserve to be posted with the FDIC for the loans that the US banks currently have outstanding (which is something that is in fact done in the Dominican Republic). So, if you want to make a comparison about the health of any banking system, using the FDIC is no benchmark. In fact, it is somewhat of a joke in my opinion. However, no one will be laughing if the US ever has a very real and serious banking crisis (once again). Although, everyone will get paid, because the US Government will once again put the problem on the back of the US taxpayers and borrow even more money to bail the thing out, which is what they did during the early 1980's. The final point is, FDIC is not what you think it is, and I hope no other country looks to emulate it. . . Another Reader Writes: . Hello John - . As we know, the belligerent U.S. government has in the past (and I'm sure will continue to do so in the future) put pressure on other countries to "close their doors" by either tightening up or completely removing 2nd passport programs. In the light of the blown out of proportion events of 9-1-1 and the fascist "laws" being passed because of it, I figure they (US Government) will get even tougher about this, whenever and wherever they can. Based upon this premise, I'm wondering what your opinion is (of course based on your first hand knowledge) of the D.R. residency program. Do you think the D.R. would stand to pressure exerted by the U.S.? In other words, as (unfortunately) a citizen of the U.S. Corporation, I'm concerned that I could pay for my residency in the DR and (for example), and then two years into my 3 years they could cancel the program - and all of us waiting for the 3 years to pass would be left holding an empty bag. I appreciate hearing your thoughts on this. Thank you and signed - Wanting To Get Out. . EDITORS REPLY: First and foremost, you need to understand and separate some of the ECONOMIC or instant Citizenship programs that existed with a very small handful of countries (Belize, Grenada and Dominica - an English speaking island in the Caribbean that has nothing to do with the Dominican Republic) and everything else. The US most certainly has put pressures on these nations and why either such programs have gone away, or have been changed. In fact, I have heard of pressures being placed on Grenada and Dominica especially, in such cases whereby they granted such instant citizenship to Americans who had outstanding IRS issues. It would seem that indeed, they do not like the idea of Americans escaping. Not to go off on a tangent, but if you want a good laugh, try and renounce your US citizenship these days. I have heard from 6 different Americans who have attempted to ask for the proper forms to do it at six different US consulates in six different countries. The American consulate told them that they don't have the forms, come back next week, etc., etc. One state department employee attempted to talk one of our clients out of it, claiming US citizens can legally maintain US citizenship so why renounce one (why not keep both). While it is very true that dual citizenship is perfectly legal for US citizens, it is honestly the first time I have heard of a US consulate employee arguing over the merits of having dual citizenship. Very funny stuff when you think about it. . . In any event, every nation on earth has policies and a process in place to allow for foreigners to become local legal residents, and perhaps eventually have that status converted to naturalization or citizenship (there are in fact some small countries whereby you could never get citizenship no matter how hard you try because such places only grant this status to people born in the country or to children of parents that already have citizenship). To continue, every other country has some sort of regular and normal immigration processes and policies. The only differences between them are the requirements, and perhaps the time frame to become naturalized. So, I think it somewhat impossible and ridiculous for the US Government to ask every other nation on earth to refuse residency status and naturalization status to existing US citizens. I suppose nothing is impossible, but I find it to be highly unlikely. However, it is certainly true that every nation has the right to change their immigration policies and requirements, and the truth is that none of us have control over that. But, to refuse residency and eventual citizenship because the persons existing citizenship was with the United States?? It could happen, but I do not see the benefit of it (for the new country). . . Another Reader Writes: . Mr. Schroder - In your opinion, is it better to retire in Panama or Dominican Republic? Is it possible to invest in both countries banks without paying either country taxes? I could live in both or live in another country but bank in both Panama and Dominican Republic? What I trying to do is receive interest on dollar accounts in safe banks but not live in the US since I am retired. There is not a lot of money but it would help if I could draw interest and not pay taxes to Dominican Republic. Is any of this possible? The information is unclear. I hope you can give me some advise of how to minimize taxes on interest earned? . EDITORS REPLY: This relates to some comments that we have made previously, in that it really is not the case that one is better than the other, but rather offers different things (or we can say different attributes). Both Panama and the Dominican Republic are attractive in my opinion but for different reasons. Although, I can say that the DR probably offers more leisure activities than Panama. This is true because it is a highly developed tourist destination, (that is trying to convert or orient itself more towards business, banking, telecommunications, etc.). Panama has traditionally been a destination known for business and banking (that is trying to now diversify into tourism). One might say each one trying to become a little more like the other. However, I do think that the DR will continue to have a more active growth model when it comes to economic development and business (which is why you see higher interest rates as a function of the higher demand for capital). . With regards to banking and investing, one must keep in mind that it is a very large world out there. In addition, in today's age, investors can easily invest or conduct their banking halfway around the world (for whatever better benefits that might exist) and still keep in close contact (telephone, fax, internet, etc.). So, it could be the case that you as an investor might own some tax-free mutual funds out of Europe (or where ever) via a Panama Foundation. You might have some bank certificates of deposit in Ecuador, Hong Kong, Thailand or any other place where you are getting the best returns on your money, while living somewhere totally different. To be sure, as is the case with a large number of countries, bank account interest is certainly tax-free for both foreigners and residents (citizens also) in Panama and the Dominican Republic. In addition, since every country is really in competition with one another for foreign investor capital, it is often the case that investments made by foreigners are tax-free as an incentive. The US offers tax-free capital gains for foreigners that invest in the US stock market, and why not? Americans may not like it, but they have the same benefits and opportunities when THEY are the foreigner investor elsewhere. Even in high tax countries like Sweden, foreigners (non Swedish residents or citizens) enjoy tax-free bank account interest, and so it goes with a list of countries too long to print. Obviously one should look to set up your investments in such a way whereby you get the best returns AND the best tax benefits (tax-free if possible). Many of our clients have already done so and it is very possible to become a citizen of the world, living and investing tax-free if you simply know how to set it all up properly. This may eventually include such issues as becoming a citizen of a country that does not tax foreign source income or utilizing a number of vehicles (offshore companies, etc.) - but the point is that this is very do-able. . If any government (especially a so-called free democratic government), tells you one way or another, that you cannot invest your money where you want, live where you want and cannot change your citizenship or residency if you choose, then I would tend to question why I was still a citizen of such a country in the first place. Whether you realize it or not, you ARE free. No government owns you (in a democratic society, the people are supposed to own the government, but many politicians have forgotten this concept). You should be able to become a citizen of any country or society that you want (that wants you in return, and respects you, which is even more important), especially if the tax benefits are better, the lifestyle better, and so on. This does not mean you have the right to harm others or that joining up with some terrorist group is condonable, but in the least, I am speaking of average, peaceful, law abiding citizens that want something better that what they have at the moment. Of course, for each person, the term better will have its own definitions of what exactly is better, which is why it can be difficult for me or anyone else to say which country is BEST for you personally. But, many people have found a better life elsewhere (by expatriating) , and there are countries remaining on the planet that do not tax you to death (and perhaps can offer lower cost of living, etc.). Both Panama and the Dominican Republic are two such countries to consider, but the truth is that the list of such countries is actually quite long. . Another Reader Writes: . I have followed your articles and studied your web site. I am very interested in establishing an " offshore Corp." & bank account. But it seems there is a large loophole. While people might not divulge who owns the Corporation, the banks will disclose who is a signer on the bank account as a matter of doing normal business. Does this not ruin the secrecy angle? How does one remain incognito? . EDITORS REPLY: I see two issues or really two questions here. One is about US tax connection and tax reporting issues (if that is what you are asking) and the other a very general question about privacy (without the tax angle factored in). In this regard, I am not sure which question you are asking, but if the tax angle, then I can say this: . Americans (who really have more of a tax problem than anyone else in the sense that they cannot declare themselves non-resident for tax purposes as Canadians and Europeans can do) have an almost impossible time of trying to escape taxation and be in full compliance with the current tax code completely. This leaves a few choices, one of which is to not be a signatory on anything and not to have their name on anything. Of course, this leads to the question - Would you trust someone you never met before to be in charge of your bank account 3000 miles away? In other words, how comfortable do YOU feel about having someone you do not know act as a signatory over your bank account. I do not cater to such an idea and which is why we feel it best for clients to be in charge of their own affairs (and why we are not signatories on client's bank accounts). There have been too many sales pitches of people in the offshore industry who say Trust ME, and later disappear with the loot, so for me this is not even an option. . So, the only other option is to either be a signatory your-self or have someone you know and trust who is not a US signatory act as a signatory in respect to your bank account(s). This of course is a very different matter than the general question of privacy, in which case, I would hope that most banks would be professional enough (if not in a jurisdiction whereby privacy was somehow codified into law) to refuse any kind of customer information unless asked under a court order or by the proper legal authorities (in the case of someone other than the client). Again, this is a very different matter also from someone asking for a list of ALL Italian clients (for example) rather than an issue with one particular client regarding an inquiry from the legal authorities. . . The Following Sent in By a Reader: . . DEMOCRAT: You have two cows. Your neighbor has none. You feel guilty for being successful. You vote people into office that put a tax on your cows, forcing you to sell one to raise money to pay the tax. The people you voted for then take the tax money, buy a cow and give it to your neighbor. You feel righteous. Barbara Streisand sings for you. . SOCIALIST: You have two cows. The government takes one and gives it to your neighbor. You form a cooperative to tell him how to manage his cow. . REPUBLICAN: You have two cows. Your neighbor has none. So What? . COMMUNIST: You have two cows. The government seizes both and provides you with milk. You wait in line for hours to get it. It is expensive and sour. . CAPITALISM, AMERICAN STYLE: You have two cows. You sell one, buy a bull, and build a herd of cows. . DEMOCRACY, AMERICAN STYLE: You have two cows. The government taxes you to the point you have to sell both to support a man in a foreign country who has only one cow, which was a gift from your government. . BUREAUCRACY, AMERICAN STYLE: You have two cows. The government takes them both, shoots one, milks the other, pays you for the milk, and then pours the milk down the drain. . AMERICAN CORPORATION: You have two cows. You sell one, lease it back to yourself and do an IPO on the second one. You force the 2 cows to produce the milk of four cows. You are surprised when one cow drops dead. You spin an announcement to the analysts stating you have downsized and are reducing expenses. Your stock goes up. . FRENCH CORPORATION: You have two cows. You go on strike because you want three cows. You go to lunch. Life is good. . JAPANESE CORPORATION: You have two cows. You redesign them so they are one-tenth the size of an ordinary cow and produce twenty times the milk. They learn to travel on unbelievably crowded trains. Most are at the top of their class at cow school. . GERMAN CORPORATION: You have two cows. You reengineer them so they are all blond, drink lots of beer, give excellent quality milk, and run a hundred miles an hour. Unfortunately, they also demand 13 weeks of vacation per year (and have a very powerful labor union). . ITALIAN CORPORATION: You have two cows but you don't know where they are. While ambling around, you see a beautiful woman. You break for lunch. Life is good. . RUSSIAN CORPORATION: You have two cows. You have some vodka. You count them and learn you have five cows. You have some more vodka. You count them again and learn you have 42 cows. You count them again and learn you have 12 cows. You stop counting cows and open another bottle of vodka. The Mafia shows up and takes over however many cows you really have. . POLISH CORPORATION: You have two bulls. Employees are regularly maimed and killed attempting to milk them. . FLORIDA CORPORATION: You have a black cow and a brown cow. Everyone votes for the best looking one. Some of the people who like the brown one best vote for the black one. Some people vote for both. Some people vote for neither. Some people can't figure out how to vote at all. Finally, a bunch of guys from out-of-state tell you which is the best-looking one. . NEW YORK CORPORATION: You have fifteen million cows. You have to choose which one will be the leader of the herd, so you pick some cow from Arkansas. . . . This information has been compiled and presented by John Schroder of Ascot Advisory Services, for the benefit of clients and readers. Ascot Advisory Services provides assistance with such matters as offshore company formation, Panama Foundations, offshore banking, and special services in the Dominican Republic regarding residency, free zone applications, etc. For more information: |
